The Kenyan transport sector is currently undergoing visible rapid transformation driven by significant socio-economic and technological advancements. Within the Rail sub-sector, the SGR has become pivotal in freight and passenger movement and a vital link in trade and commerce.
On this backdrop, the Government seeks, in accordance with the Updated Integrated National Transport Policy of 2024, to attract private sector financing for transport infrastructure development. This seems to be the premise of the 2024 Railways Bill which seeks to overhaul the existing Kenya Railways Corporation Act.
Kenya’s railway is about 120 years old. Despite this the railway sector is operated without a cohesive national rail policy that can provide precise strategic direction. The 2,778 km track of metre gauge railway has low design capacity and limited coverage while the 721 km track of Standard Gauge Railway (SGR) has high design capacity but limited coverage and is generally felt to be under-utilized.
As of now, Kenya Railways works on a monopolistic and integrated structure. Since it is a government monopoly in the Railways sub-sector there exists no inter-sector competition at present. The only competition that the Kenya Railways is hit by is from other modes of transport, primarily road.
The Salient Features of the Bill
1. The two-tier sector-regulation approach
For many years, Kenya Railways has monopolized the railway sector, handling all functions including construction, operation, and regulation. This centralization has often led to inefficiencies in governance and limited development. Thus, the Railways Bill of 2024 aims to dismantle this monopoly and introduce a more effective administrative framework.
This Bill proposes the establishment of two distinct entities, which are the Railway Regulatory Authority and the Kenya Railway Corporation, for the separating of functions. Pursuant to section 53(1) of the Bill, the Railway Regulatory Authority will focus on regulating the sector, including advising the Cabinet Secretary on safety and economic policies, developing safety operation strategies, facilitating member education and research, and overseeing the licensing of train drivers and railway workers.
Meanwhile, section 6(1) of the same Bill mandates the Kenya Railway Corporation to handle the construction, maintenance, and operation of railway infrastructure. This includes training through the Railway Training Institute, allocating infrastructure capacity, managing traffic on the railway network, advising the Cabinet Secretary on system policies, and overseeing the repair and expansion of the railway network and logistics hubs.
Private sectors involvement
The Bill, through Sections 104 and 110, empowers private entities and stakeholders to seek approval from the Railway Regulatory Authority for the construction and operation of private railway lines. Applicants must demonstrate adherence to the environmental standards outlined in the Environmental Management and Coordination Act and submit a detailed feasibility study report.
Moreover, proponents are required to obtain certification from the Authority for any newly constructed railway to ensure that the railway meets all safety and operational standards. Entities intending to provide services, such as operating rolling stock on private railways, must secure a license from the Authority.
Safety Management Systems
The Bill mandates that both Kenya Railways and operators of Private Railway Lines implement robust Safety Management Systems (SMS) to ensure compliance with relevant safety regulations and common safety targets.
The Bill requires that the SMS incorporate specific safety targets and strategies for achieving them. This includes detailed safety rules, procedures for risk assessment related to operational changes or material updates, comprehensive worker training programs, and protocols for reporting and investigating hazardous incidents. Additionally, the SMS must include regular audits and effective emergency response and communication procedures.
Monitoring of dangerous occurrences
Under Chapter Four of the Bill, railway line operators and infrastructure managers are required to promptly report dangerous occurrences to the Cabinet Secretary, the Authority, and the Accident Investigation Body.
Additionally, operators and infrastructure managers must submit quarterly reports to the Authority detailing all accidents and incidents that have occurred. Following these reports, the Accident Investigation Body is tasked with conducting a thorough investigation and presenting its findings to the Cabinet Secretary within 30 days. This is designed to ensure rigorous monitoring of accidents and dangerous occurrences, thereby enhancing overall safety and operational efficiency in the railway sector.
Offences and Penalties
The Bill aims to enhance compliance with railway operation standards by establishing both major and minor offenses, along with corresponding penalties under Part VII. For example, unlawful obstruction of railway operations could result in a maximum imprisonment term of 10 years. More severe offenses, such as endangering passenger safety through the theft of spare parts, vandalism, or tampering with railway facilities, could lead to a life sentence upon conviction. Furthermore, encroachment onto railway land could incur a penalty of up to KES. 20 million, a 10-year imprisonment term, or both. On the same note, actions of employees that endanger safety operations could result in fines up to Ksh. 100,000, a maximum of 3 years in prison, or both.
Dispute resolution
The Bill establishes a dispute resolution mechanism in Chapter II of Part V. It provides a clear process for addressing grievances with decisions made by the corporation. Aggrieved parties may submit their claims to the Authority within 14 days, which will be reviewed and determined within 60 days. If the party remains dissatisfied with the Authority’s decision, they have the right to appeal to the Appeals Board within 14 days. Should they still find the Appeals Board’s decision unsatisfactory, they may take the matter to the High Court.
Please contact Divinah Sarange Ongaki (dso@smc-legal.com or info@smc-legal.com) for any clarification required on the contents of this article.